Council tax billing and recovery
A local authority can take steps to recover outstanding council tax from the liable person following the issue of a bill and statutory notices.
Billing notices
The local authority must issue certain statutory notices to charge and recover council tax.
Demand notice
The local authority serves a council tax bill on each dwelling as soon as practicable after setting the amount of tax for the relevant year, and at least 14 days before the first instalment is due.[1] The bill is called a demand notice. Council tax is due once the demand notice is issued.[2]
The demand notice must include the:[3]
name of the liable person
date it was issued
period that it relates to
address of the dwelling
band of the dwelling
amount of council tax due
The notice must give details of any discount, reduction or premium and an explanation of the reason for it.
The demand normally allows payments to be made in instalments.[4] Bills issued at the start of the financial year normally allow payments in 10 instalments.
The taxpayer has a right to request payment in 12 instalments.[5]
Bills issued after the start of the financial year normally allow one less instalment than the number of months remaining in the financial year. Bills issued between 1 January and 31 March can require a single instalment to be paid on a specified date.[6]
Reminder notice
The local authority can serve a reminder notice following an unpaid instalment of council tax.[7]
The reminder notice requires payment of any missed instalments to be made within seven days.
If the missed instalments are not paid, the remaining sum of council tax becomes due in full after a further seven days.[8] The taxpayer loses the right to pay in instalments. The local authority need not issue a final reminder before a court summons.[9]
Where two reminder notices are issued in one financial year, the next time an instalment is unpaid the remaining sum of council tax becomes due in full.[10] The taxpayer loses the right to pay in instalments.
The local authority and the taxpayer can still make a payment arrangement if the taxpayer has lost the right to pay by instalments.
Final notice
If two reminder notices are issued in one financial year, and the tax has become due in full, the local authority must issue a final notice before it can apply to a magistrates’ court for a summons.[11]
The final notice should state the amount of council tax the local authority would seek to recover when it applies for a liability order.
Magistrates' court liability order process
The local authority can apply to the magistrates’ court for a liability order after seven days following a final notice. The local authority has discretion to make the application or allow the taxpayer more time to pay.[12]
Magistrates’ court summons
A summons will be issued to the taxpayer when a local authority applies to the magistrates’ court for unpaid council tax. The summons instructs the taxpayer to attend the magistrates’ court to explain why the council tax is unpaid.[13] The summons must be served at least 14 days before the hearing.[14]
Once issued, a council tax summons cannot be withdrawn without agreement from the local authority and taxpayer.
There is no prescribed form for a council tax summons. It should set out the outstanding balance and can include the costs incurred by the local authority. The summons can also state that the local authority would withdraw it if the council tax owed, plus costs incurred to date are paid.
Service of the summons
A council tax summons can be served by any of the following methods:[15]
delivering it to the taxpayer
leaving it at the taxpayer's usual, or last known, place of abode
posting it to the taxpayer at their usual, or last known, address
leaving it at, or posting it to, an address given by the taxpayer at which service will be accepted
Time limits to apply for a liability order
The local authority must apply for a liability order within 6 years from the date the demand notice was issued.[16] Once the magistrates' court has issued a liability order there is no time limit for taking enforcement action.[17]
Unreasonable delays can give the taxpayer grounds to complain to the local authority and Local Government Ombudsman on grounds of maladministration.
When the court must make a liability order
The magistrates’ court must grant a liability order where it is satisfied that the sum is payable by the taxpayer and the balance is unpaid.[18]
The local authority must satisfy the magistrates that the:
sums due have been properly demanded
full balance was not paid by the required date
correct reminder notices, or a correct final notice, were issued
demanded balance was not paid within seven days of the reminder notice or final notice
council tax summons was properly served
The taxpayer can ask the court to dismiss the application if the local authority has failed to comply with any requirement.
In addition to defending the liability order, the taxpayer can raise an appeal to the Valuation Tribunal England (VTE) or Valuation Tribunal Wales (VTW). Raising an appeal could increase the chance of the liability order hearing being adjourned.[19]
Attending the liability order hearing
The person named on the summons is not required to attend the hearing. It will proceed in their absence and normally results in the local authority being granted a liability order.
Failure to attend the liability order hearing cannot result in a warrant of arrest.[20]
Costs of issuing a liability order
The court fee for each application for a liability order is 50 pence.[21]
Local authority costs incurred
In addition to the court fee, a local authority can charge ‘costs reasonably incurred’.[22] In England, this is usually a sum between £80 to £130 for each liability order granted.
In Wales, additional costs cannot exceed £70.[23]
Magistrates' court discretion
Magistrates have discretion to award costs. The magistrates must be satisfied the costs were properly incurred by the local authority and then assess their reasonableness. The taxpayer can request an explanation of the costs awarded and can challenge unreasonable costs.[24]
Challenging a liability order
A taxpayer can challenge a liability order the local authority obtained incorrectly or in error.
A local authority cannot obtain a liability order if it has not issued a reminder or final notice to the taxpayer or if the outstanding balance, plus any costs, is paid before the hearing.[25]
The taxpayer can ask the magistrates' court to adjourn the hearing pending the outcome of an application for a reduction.
The magistrates should consider adjournment requests fairly. This can include consideration of any likely adverse consequences to the taxpayer and the extent to which the taxpayer was responsible for the circumstances that led to the request. A refusal to adjourn may give grounds for a judicial review.[26]
Quashing a liability order
A local authority can apply to the magistrates’ court for an order to quash a liability order on the grounds that it should not have been made.[27] Quashing is the term used for cancelling a liability order.
The taxpayer does not have a statutory right to apply to court to quash a liability order. They can request that the local authority quash the liability order on their behalf.
The taxpayer can complain to the local authority on grounds of maladministration if it refuses to apply to quash the order. If the local authority rejects the complaint, it can be escalated to the Local Government and Social Care Ombudsman (England), or the Public Services Ombudsman (Wales).
Where the local authority unreasonably refuses the taxpayer's request to quash a liability order, the decision can be challenged by judicial review in the High Court.
Setting aside a liability order
There is no right of appeal against a liability order. If a magistrates' court grants a liability order without the power to make one, the taxpayer can request that the order is set aside.
To set aside a liability order, the magistrates must be satisfied that all the elements of a three-point test are present. They are that:[28]
there is a genuine and arguable dispute over liability to pay
there is a substantial procedural error, defect, or mishap
the application was made promptly after the resident had notice of the order
A procedural error can include where the taxpayer did not receive the required notices, or the summons was not properly served on the taxpayer.
The courts have interpreted promptly to mean that the application needs to be submitted within three weeks of the taxpayer becoming aware a liability order has been granted.[29]
There is no prescribed form to apply to set aside. The taxpayer can send a letter to the court requesting a hearing to consider setting the liability order aside.
Local authority response to the application
The High Court has held that once the local authority is notified of the application to set aside, it is expected to review the merits of the taxpayer's case. The taxpayer can notify the local authority as soon as they make the application to court.[30]
If the local authority agrees there has been a procedural error, it should join the request to set aside the liability order. If the local authority disagrees, it must respond to the application outlining its dispute.
Costs of the set aside application
Costs can be awarded to the successful party if the set aside application is contested.[31]
Last updated: 13 January 2025